When Will Us Debt Levels Become Unsustainable?

Chris @Hauseit (https://www.hauseit.com/) goes over a thought experiment on what might happen when US debt-to-GDP one day reaches a tipping point. What level of public debt can the economy sustain? At one point does something break?

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Talk of the petroyuan or petrogold, and the Saudis confirming that they will accept payments for oil in non-dollar currencies will only erode demand for dollars abroad. If we can't print money and have large amounts of it absorbed abroad, then we can't export inflation, and if dollars rush onshore, that means more dollars chasing few goods and services and higher inflation domestically.

These things are happening around the edges and publicly. Though de-dollarization is likely far off, and the US Dollar will be secure in its status as the world's reserve currency for some time to come, the trends are not looking good.

Furthermore, developed economy central banks are in a pickle with both high public and private debt levels, and high inflation. If you raise rates, you can drive down inflation at least temporarily, but then debts become unaffordable, which means you then have to cut rates by buying bonds and expanding the central bank balance sheet, which weakens the currency, which increases import prices and inflation, and on and on until the central bank owns too much of the public debt and breaks the proverbial straw on the camel’s back.

Lastly, the smart way out would be to increase supply dramatically with a massive boost to productivity, ie fusion, robotics, generative AI. If there's any country that can make this happen, it's the U.S.
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